Audi's A3 e-tron to pave way for electrified vehicle push

2 plug-in hybrids and 2 battery EVs to join lineup in coming years

PALO ALTO, Calif. -- Audi's A3 Sportback e-tron launch is far more important to the brand than its modest 5,000-vehicle annual sales goal would suggest.

Audi is using the launch of the low-volume plug-in hybrid to develop the sales and service infrastructure the company will need to launch four electrified vehicles slated to join its lineup in the next several years -- two plug-in hybrids and two battery-electric vehicles.

The A3 e-tron launch will lay the groundwork for the rest of Audi's electrified lineup, Audi of America President Scott Keogh said. Part of that includes training to ensure that dealers are well-versed enough to serve shoppers who, Keogh says, are steeped in EV knowledge and often "let down" by the electric vehicle buying experience at many dealerships.

It also means studying the purchase behavior of A3 e-tron intenders to see, for example, whether they choose to buy an optional Audi-designed home charging station and rooftop solar panels installed by SunPower that Audi plans to offer as extras, Keogh said.

On the service side, it means ensuring that dealers are ready with the technicians and charging stations needed to service electrified vehicles.

"As we move from this car into multiple cars with a lot more volume, that stuff has to be seamless and perfect," Keogh said on the sidelines of the A3 Sportback e-tron launch event last week here. "I think it's a good test car to get the infrastructure exactly right."

Keogh says that a "decent" sales goal for the A3 Sportback e-tron would be around 5,000 per year, in the ballpark of what the previous-generation A3 sold in the U.S.

The real volume comes a little later. Around six months after the redesigned Q7 goes on sale in January, Audi will add a plug-in hybrid version of the crossover. In 2018, Audi plans to launch a battery-electric midsize crossover based on the e-tron quattro concept shown in September at the Frankfurt auto show, and another EV will follow.

Keogh says dealers are on board. All but a few of Audi's roughly 280 dealers have agreed to be e-tron retailers, which requires dealers to install four charging stations at their stores.

Keogh says that by 2025, plug-in hybrids and battery-electric vehicles will need to account for a quarter of U.S. sales to meet emissions and clean-car sales requirements set by California. For Audi, that means offering a broad array of plug-in vehicles in mainstream segments.

Keogh says the cost of advanced batteries has fallen from around $1,000 per kilowatt hour to around $250 per kWh today, with some forecasts projecting costs to fall to around $150 per kWh in the next few years. Helped by those falling costs, Keogh says the industry is approaching a "tipping point" where battery-electric cars will reach cost-competitive levels with internal combustion engine vehicles.